How Can High-Net-Worth Spouses Avoid Giving Up Too Much in Their Divorce?
As a high-net-worth individual, protecting your assets is likely to be a central focus of the divorce process. You’ve spent years, decades, or perhaps your entire life building your wealth, and you want to make sure that you are able to keep as much of it as possible.
In California, unless you signed a prenuptial agreement or postnuptial agreement, any assets you accumulated during your marriage are likely to be classified as “community property”, unless it is a gift or inheritance. This means that they will be subject to distribution in your divorce; and, absent unique circumstances, it means that your spouse is likely to be entitled to somewhere around half of your overall community property estate (including any assets that he or she accumulated during the marriage).
So, how can you ensure that you preserve as much of your wealth as possible? This is a complex question that requires legal advice that is carefully tailored to your unique financial and family circumstances. In broad terms, some of the key factors include:
1. Delineating Separate and Community Property
When millions of dollars are potentially at stake in your divorce, every asset matters. While California law is clear that community assets are subject to division, it is equally clear that “separate” assets are not. The basic rule regarding separate property is that anything one spouse owned prior to the date of your marriage is his or hers to keep (along with certain categories of assets acquired during the marriage).
In practice, however, delineating between separate and community assets is far more complicated, and identifying your separate assets will be a crucial early step in determining how much of your wealth is on the table in your divorce.
2. Identifying and Valuing All Community Property Assets
In addition to identifying which of your accumulated assets qualify as community property, it is important to identify which of your spouse’s accumulated assets qualify as community property as well. Of course, here, the terms “your” and “your spouse’s” are somewhat misrepresentative, as community property assets are technically owned equally by both spouses.
Even if your spouse’s contributions to your community estate pale in comparison to yours, they are still relevant to the divorce process, and identifying all of the assets that are on the table will help ensure that you do not give up any more than is absolutely necessary.
In addition to examining your shared personal property, real estate holdings, and shared and individual accounts, there are various other ways to identify community assets for purposes of your divorce. You are entitled to this information as a function of the formal divorce process in California; and, if you are concerned that your spouse may be hiding assets, there are legal means for uncovering hidden assets as well.
3. Finding Leverage in Divorce Settlement Negotiations
When negotiating a divorce settlement, protecting as much of your wealth as possible means securing an understanding of your spouse’s priorities as well as your own. As with all aspects of the divorce process, protecting your wealth starts with putting together a strategic plan, and an experienced North County, San Diego family lawyer will be able to help you develop and execute a plan that allows you to retain as much of your wealth as possible after your divorce.
Discuss Your Divorce with North County, San Diego Family Lawyer Richard M. Renkin
If you would like more information on how to protect your wealth during your divorce, we encourage you to contact us for a confidential initial case evaluation. To request an appointment with North County, San Diego divorce attorney and Certified Family Law Specialist Richard M. Renkin, please call 619-299-7100 or tell us how to reach you online today.